The Business Performance Director module in DC1 Analyser addresses and combines two very important areas for top management decision support:
- Calculation and follow-up of the return on investments (ROI)
- Calculation and reporting of overall components (also referred to as key performance indicators) for a company
Return on investment
Measuring your return on investments has become an ever-increasing priority. The benefits from investing in something, whether it be in DC1, or upgrading to a new release or implementing add-on modules are critical factors. The spin-off from such investments, (i.e. improved order handling routines, increased efficiency, optimised inventory, etc), define the rationalisation behind this investment in capital.
But how do you measure these benefits? How do you equate these into real values to determine a return on investment calculation? Fundamentals for making such a calculation are:
- Changes in sales value
- Changes in procurement efficiency resulting in improved gross margin
- Changes in capital utilisation for inventory, accounts receivables and account payables
- Changes in costs
Essentially, all companies want clear indications that their investment will pay off.
Key performance indicators
The solution to being able to project any kind of pay-off, are components (i.e. Key performance indicators). These can help explain the changes that have taken place over any time period. Such questions for which you want answers could be: “Are service levels and fill rates improved?” “Did inventory turnover increase?” “Did we save any outstanding days in A/R?”
The Business Performance Director comes loaded with numerous predefined components, logically categorised, that reference the so-called SCOR model. You can utilise, change or hide them at will. You can also create your own components (KPI’s) to be able to measure that which is relevant for your company.
Each component carries its own predefined formula that can also be tailored. The referencing value for each component can be based on data from the DC1 Business Information Warehouse database (balances or budgets), another component or a constant.
Per component, you can choose to measure the results against the following:
- Industry standard (manually entered)
- Company target (manually entered)
- Base value before investment (calculated based on data retrieved from DC1)
The calculated results will show you the following:
- Actual value (calculated)
- Change in Actual value compared to Base value (calculated)
- Return on Investment per year (calculated)
- Accumulated Return on Investment (calculated up to and including the current month of the year)
- Calculated pay off (i.e. if you continue along the same lines you will regain your investment in this time frame).
Retrieving the data
You can retrieve the data from the BIW database in DC1 (i.e. Balance file), or enter the values manually. Manual entry should be done for Industry standard and Company target as no balance is stored in the database for these. Even though a balance is carried for Average and Base values – you have the option to enter data manually, instead of retrieving data. The blue exclamation symbol, to the right of an Actual value, indicates that the values have been manually entered.
When retrieving data – you have the possibility to change/define the rules for the retrieval of data. The data retrieved depends on the balance type/selection criteria combination, which is ultimately referred to and used in the component formulas. The system comes preloaded with the necessary predefined selections for the components that are also preloaded.
Note: It is important that you review these selections to ensure that they fit with your company’s data.
Depending on the data you want to retrieve, there may not be a dedicated balance type. For example: If you are measuring employee costs, these costs are more than likely booked on a separate account in the G/L instead of on system level. For the System currency balance type, you would make an employee cost selection instructing the system from which account part the costs should be retrieved.
For more information about Balance types, see Overview of balance structure in DC1.
BPD Workspace
The proactive workspace, in which you work and view the information on-line, contains all necessary information. You enter the Total investment you want to measure for the applicable time period and then let Business Performance Director calculate the result.
Tip: When analysing the result you also have the option to manually enter alternative values and thus simulate different scenarios.
On each line in the workspace you can drill down to a graph (and figures) to view a rolling 12-month trend.
Note: See Scenario using Business Performance Director for a “realistic scenario” outlining how you can easily add a new component, thereby catering the tool to your needs.
BPD Workspace
The tables below depict the following:
- The icons that can be used in the BPD providing quick access to the various functions. All functions are also accessed via the menu bar.
- The different areas of the BPD workspace.
Note: For a description of the columns, see Run a calculation and analyse the data in Business Performance Director.
Icons
| Icon | Function | Miscellaneous information |
|---|---|---|
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Maintain components | |
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Maintain component groups | |
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Retrieve data from business information warehouse | This is where you retrieve the balance values for all balance types that are stated in a formula, as well as make your selections for a balance type. |
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View Company target details | |
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View Actual details | |
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View Base details | |
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View Change details | |
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View Base/Actual/Change graph | |
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View Company target graph | |
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View Actual graph | |
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View Base graph | |
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View Change graph | |
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Edit Actual values | Here you can edit any reference values for Industry standard, Company target and/or Actual/Base. |
BPD Workspace areas
| The cell below depicts the area where you enter your input values for the report. The calculated result varies depending on the input values you enter. |
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| The cell below depicts the display area of the report. The different columns will be updated with the applicable data. See Run a calculation and analyse the data in Business Performance Director for a description of each column. |
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| The cell below depicts the result of the calculation, i.e. Calculated pay off time frame. |
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Related topics
- Maintain component groups in Business Performance Director
- Maintain components (KPI’s) in Business Performance Director
- Maintain formulas for actual/base values in Business Performance Director
- Maintain ROI formulas in Business Performance Director
- Maintain the industry standard, company target and actual/base values in Business Performance Director
- Retrieve data from BIW in Business Performance Director
- Connect and view documents in Business Performance Director
- Run a calculation and analyse the data in Business Performance Director
- Scenario using Business Performance Director
- Overview of balance structure in DC1